Helping or Hurting?

Helping or Hurting?

A federal Atlantic energy initiative got mixed reviews by regional policy and economic experts after Shawn Graham picked a room full of Toronto business people to tell Ottawa leave New Brunswick’s energy hub alone.

The premier told the Economic Club of Canada in a speech Tuesday that Sunday’s federal announcement on growing what has been coined “the Atlantic energy gateway” conflicts with the province’s energy ambitions.

Graham laid down New Brunswick’s claim of being closest to lucrative U.S. markets, adding that he would not give up the geographical advantage “for another jurisdiction to simply run wires through our province.”

The speech was the culmination of a couple of days of stewing by government officials at the highest levels in Fredericton, who felt side-swiped by an announcement in Cape Breton by federal Atlantic Gateway Minister Peter MacKay.

As Graham was delivering his speech, Donald Savoie, the Canada research chair in public administration and governance at the Université de Moncton, was getting calls outside the country from worried Maritimers as he tried to finish writing a book and take in some golf.

Those who phoned him – some civil servants, none from New Brunswick – – worried about what the federal announcement would mean for provincial energy ambitions.

But the professor said money from Ottawa is going towards a “fairly minor project” to take stock of the region’s energy assets, markets and barriers to growth.

New Brunswick will still be the energy powerhouse that drives economic development for all of the Maritimes, he said, welcoming the federal regional perspective.” If the energy hub is to fly, its home base is Saint John,” Savoie said .”There’s no other place for it.”

Constantine Passaris, the chairman of economics at the University of New Brunswick, said the federal government’s regional energy plan could derail New Brunswick’s path to eliminating federal transfer payments, in part, through energy.

Nova Scotia, which he feels is behind the ball on the energy portfolio, stands to benefit.

“In this federal announcement, who has most to gain? I think it’s Nova Scotia. I think New Brunswick is being marginalized,” Passaris said.

Charles Cirtwill, the Executive Vice-President at the Atlantic Institute of Market Studies, said the federal government’s move to develop an energy gateway is positive and does not take away from New Brunswick.”

“New Brunswick is by anybody’s definition, in the driver’s seat,” Cirtwill said.

Playing on the use of the terminology of the gateway – known in the region for the Atlantic transportation gateway – Cirtwill said Ottawa ought to throw more money at growing energy over transportation infrastructure, considering the burgeoning energy-hungry northeastern U.S. market.

“They’d be almost better off spending $4 million on transportation infrastructure and $2.1 billion on energy,” he said.

In a phone interview late Tuesday afternoon, Graham expressed concern that with MacKay’s announcement, energy – traditionally governed by the province – has now become a federal cause.

“We just don’t want to see a number of wires being erected to transmit electricity through New Brunswick that is going to benefit the other jurisdictions versus New Brunswick, which has taken the lead on this initiative,” Graham said, adding that the province has done most of the “preliminary work” the federal ministers hope to accomplish.

In their announcement Sunday, MacKay and Raitt said they want to establish a regional committee with representation from federal and provincial governments, and the utilities, and plan to host an energy conference.

MacKay said in the speech Sunday he wants the region to “tap into” a perceived growth in demand for power in New England, which currently uses about 31,000 megawatts and could need at least 20 per cent more power by 2020.

The news came just days after Irving Oil Ltd. – along with Graham, Energy Minister Jack Keir and Maine Gov. John Baldacci – laid out plans for a northeast energy corridor between the two jurisdictions.

Irving Oil is looking into moving power from a natural gas-fired cogeneration plant and renewable supplies through a new transmission line to the neighboring U.S. state.

Canaport LNG’s Saint John liquefied natural gas terminal, as well as two other proposed projects – a second nuclear reactor at Point Lepreau and another oil refinery in Saint John – also play into the provincial aims to eke out a spot as the region’s energy giant.